Treasury Secretary Lew Urges Congress to Grant Puerto Rico Bankruptcy

‘Only Congress can enact the legislative measures necessary for Puerto Rico to resolve this problem’

Treasury's Lew Urges Congress to Grant Puerto Rico Bankruptcy (Bloomberg)

Treasury Secretary Jacob J. Lew said that Congress needs to act without delay to help Puerto Rico deal with a worsening fiscal crisis, as he visited the island for the first time to witness the impact on the local economy.

“Only Congress can enact the legislative measures necessary for Puerto Rico to resolve this problem,” he said at a press conference in San Juan Wednesday. “The people of Puerto Rico are sacrificing, but unless that sacrifice is shared by creditors in an orderly restructuring, there is no path out of insolvency and back to growth.”

Lew reiterated the Obama administration call for bankruptcy powers for Puerto Rico, paired with independent fiscal oversight, additional health care funding and employment incentives. Republicans say they need more information about the island’s financial situation before they draft a bill and some investors oppose granting Puerto Rico restructuring powers, saying that would change the rules under which the debt was issued.

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